Portland panel backs loan to fix low-income housing

PORTLAND — The City Council Housing Committee on Sept. 14 recommended funding new homes for some of the city’s homeless population.

But the request by Developers Collaborative principal Kevin Bunker for a $191,000 loan to renovate the St. Dominic’s Apartments at 42 Gray St., while setting aside three of 12 units “for individuals or families residing in a Portland shelter,” upset a long-time city landlord.

“I’m outraged at the St. Dominic’s business. You’ve given this organization millions (of dollars) over the years. I believe there are ways to go after the money in other ways,” Carlton Winslow of Auburn Street said during a public hearing on the funding request.

The committee, with Councilor Jill Duson absent, forwarded the funding request to the full City Council as the last item in a meeting where it also heard more testimony on a housing ordinance and staff response to elements of the ordinance.

Bunker bought the building in June from St. Dom’s Housing Associates, a limited partnership established by the former Portland West, now LearningWorks; and the People’s Regional Opportunity Program, now known as The Opportunity Alliance.

Payback of the loan, a pass-through of U.S. Department of Housing and Urban Development funds, is deferred for 30 years unless the building, once the school for students of the St. Dominic’s parish, is sold by Developer’s Collaborative.

The loan is part of a package, with $64,000 loan to be loaned to the Portland Housing Authority for its development at 58 Boyd St. in East Bayside.

A request from Avesta Housing for funding for a senior housing project at 977 Brighton Ave. was rejected because the per-unit cost was higher than the Boyd Street project and its lack of “project readiness.”

The funds “are the only feasible source for correcting the years of deferred maintenance and mismanagement of the building,” Bunker said in a June 8 letter to city Housing & Community Development Division Director Mary Davis.

On Monday, Mayor Ethan Strimling, the former LearningWorks executive director, said the nonprofit held a 1/2 percent share in the partnership, with the bank that is now TD Bank holding 99 percent.

He welcomed Bunker’s purchase and his intention to let nonprofit Avesta Housing manage the property.

“Portland West had been in housing a long time, but decided to divest about five years ago because people could do a better job than we do,” Strimling said.

Bunker said the loan will pay for the most necessary repairs, including a roof that leaks into an elevator shaft. No tenants will be displaced during the repairs.

City Planning & Urban Development Director Jeff Levine said Monday the city made $417,000 in loans in 2002 at the outset of the conversion project, but the larger source of renovation funding in 2002 was $242,000 in low income housing tax credits from the Maine State Housing Authority.

The tax credits, good for 10 years, come from the U.S. Department of the Treasury to lure investors to low income housing projects and reduce lending debt loads to developers. To get the credits, housing units must be priced at 60 percent of the area median income for 30 years.

“Mr. Winslow raises a point, it is a fair question to raise,” Councilor Nick Mavodones Jr. said about reviewing whether the tax credits could be recovered to fund repairs because of the condition of the building.

Levine said the city corporation counsel’s office is reviewing whether there is any recourse for the city.